In the short run, a competitive firm has a marginal product of labor, MPL = 8L-0.5. The output price is $16 per unit and the wage is $2 per hour. At the profit-maximizing level, how many units of labor are hired by the firm?
A) L = 4
B) L = 6
C) L = 12
D) L = 8
D
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To an economist, quitting
A. makes sense if at the quantity where MC=MR, the firm loses money. B. Makes sense if at the quantity where MC=MR, the price is less than AVC. C. makes sense if at the quantity where MC=MR, the price is less than ATC. D. never makes sense.
Suppose that U.S. citizens purchase more cars made in Korea, and Koreans purchase more bonds issued by U.S. corporations. Other things the same, these actions
a. raise both U.S. net exports and U.S. net capital outflows. b. raise U.S. net exports and lower U.S. net capital outflows. c. lower both U.S. net exports and U.S. net capital outflows. d. lower U.S. net exports and raise U.S. net capital outflows.
Whenever external costs exist:
A.) Social demand is less than market demand. B.) Market demand is less than social demand. C.) Market demand and social demand are equal. D.) Market demand understates the social benefits.
Open and explicit agreements concerning pricing and output shares transform an oligopoly into a
A. Differentiated oligopoly. B. Monopoly. C. Perfectly competitive firm. D. Cartel.